VAT Return Filing

Value Added Tax (VAT) is charged on the consumption of goods and services. Be it a new business or an established business, filing for VAT return acts as a savior and also holds a good image in the eyes of the government. Today almost more than 180 countries have accepted the procedure and this got spread worldwide at a faster pace. The Middle East countries, especially the United Arab Emirates, which has been tirelessly working on setting itself as a business hub, has understood the importance of VAT filing. Realizing this, the GCC countries have entered the VAT law and agreed at a VAT rate of 5%. If you are building your business plan for UAE, you should be aware of the VAT return filing and VAT related process existing there. Do have a look at the VAT filing terms and processes and why it got accepted at a global level.

What is VAT Return Filing and VAT Compliance?

In simple terms, VAT return filing states how much VAT is to be paid or reimbursed by the tax authorities. A VAT return is done quarterly and it helps the business to track the business VAT path.

VAT is also charged for business entities involved in the business activities with other countries. While carrying out these activities it’s better to be VAT compliant to avoid any kind of penalty that becomes a hindrance in the way.

How to Calculate VAT Due/Liability?

The taxpayer is responsible for calculating the VAT return during the filing process. It is calculated considering the following factors:

  • The total sales and purchases of your business in the relevant return period
  • The amount of VAT you owe for sales
  • The amount of VAT you can claim for the purchases made

In the end, if you owe more VAT than you are able to claim, then you need to pay the difference. If the situation goes vice-versa, you can either ask for the refund of excess VAT or can carry forward the excess to next return period.

Who Should File VAT Return?

All registrants are required to file VAT return, irrespective to the type of VAT registration or sales, purchases, output tax, input tax, etc.

How to File VAT Return in UAE?

Businesses can file their VAT return online using the Federal Tax Authority (FTA) portal, where one would find the VAT 201 form. To access this form, the taxpayer must log in to the FTA e-Services portal, and select VAT->VAT 201- VAT Return on the navigation menu. Here, one is required to fill in information regarding the following:

  • Details of the taxable person
  • VAT return period
  • VAT on sales and all other outputs
  • VAT on expenses and all other inputs
  • Net VAT due
  • Any other reporting requirements
  • Declaration and authorized signatory

Once the form is duly filled and submitted, the taxpayer would receive an e-mail from the FTA confirming the submission of VAT return form. After submitting the return, the tax payer has to pay the due tax, if any, through one of the various payment channels like E-dirham, exchange houses, online bank transfer, over-the-counter bank payment, etc.
How to file VAT return in UAE

The difference between the output and input tax equals to the tax liability of the registered person. Output tax is charged on the supply of goods and services made to other people, whereas input tax is charged from the recipient of goods or services. A user can recover input tax from FTA, provided there is evidence regarding the amount of VAT paid, which can be a tax invoice or other documentation.

In the case of sales and other inputs, the taxable person should report,

Supplies made that are subject to standard and zero VAT rate and those that are exempt from VAT

Supplies received that come under reverse charge mechanism

Goods that have been imported to UAE, declared through customs

Adjustments to goods that have been imported to UAE, declared through customs

Refunds provided to tourists under Tax Refunds for Tourists Scheme

A nil VAT return will have to be submitted before the due date, if business transactions didn’t happen during the tax period. Failure to submit VAT return within the deadline will result in penalties. In the case of first occurrence of delay, an amount of AED 1,000 will be imposed and if it keeps repeating, AED 2,000 will be charged for each offence.

Tourists visiting UAE are eligible for a VAT refund for products bought at registered stores, under the VAT refund scheme for tourists.

VAT return filing can be made a hassle-free process with the help of AON. We have been associating with FTA for VAT related issues from quite a long time and hence are well-versed with the complete procedure. AON’s VAT consultants are ready to guide you professionally on VAT return filing, anytime.

Benefits of Filing VAT Return

  • VAT compliance brings along with it a certain business goodwill. In fact, many large firms are often reluctant to conduct business with companies that aren’t VAT-registered
  • The business image gets highlighted once registered under VAT law
  • VAT is easier to manage as compared to any other indirect tax

Thus, you can see how important it has become for business entities to implement VAT filing process and also to become VAT compliant while carrying out multi-national businesses. VAT filing not only protects your business but gives a legal assurance and proof of your business existence and it holds an upper-hand in the arena of tax payments and avoids financial loss. Are you trying to figure out how to initiate the process? Well, we have a solution for you.

Alriyadah | Your VAT Return Filing Guide

Alriyadah has been working as a business consultant and has been continuously dealing with businesses helping them setting their accounts, taxation and finance domain. The firm has been delivering outstanding services that resulted in retaining satisfied clients at a global level. Some of our services include:

  • VAT registration
  • Filing VAT returns
  • Payment of return submission
  • VAT recovery
  • VAT compliance process
  • Dealing with tax inspection

Dealing with VAT is a tedious process. Our business experts would start from the very scratch and make it much easier to deal with. Alriyadah strives to give you the transparency, control and a better understanding of your business dealing that would maximize your profit and lowers your expenses to a great extent. To initiate the process, do contact us – we’d be happy to assist you.

Show/Hide Edit Mode UI

VAT Return Filing

A VAT return provides information regarding output tax due and input tax recoverable, that needs to be submitted to the Federal Tax Authority by the taxable person at regular intervals. Submission of VAT return should be doneonline, via FTA portal, before the 28th day following the end of tax period.

How to file VAT return in UAE

The difference between the output and input tax equals to the tax liability of the registered person. Output tax is charged on the supply of goods and services made to other people, whereas input tax is charged from the recipient of goods or services. A user can recover input tax from FTA, provided there is evidence regarding the amount of VAT paid, which can be a tax invoice or other documentation.

In the case of sales and other inputs, the taxable person should report,

Supplies made that are subject to standard and zero VAT rate and those that are exempt from VAT

Supplies received that come under reverse charge mechanism

Goods that have been imported to UAE, declared through customs

Adjustments to goods that have been imported to UAE, declared through customs

Refunds provided to tourists under Tax Refunds for Tourists Scheme

A nil VAT return will have to be submitted before the due date, if business transactions didn’t happen during the tax period. Failure to submit VAT return within the deadline will result in penalties. In the case of first occurrence of delay, an amount of AED 1,000 will be imposed and if it keeps repeating, AED 2,000 will be charged for each offence.

Tourists visiting UAE are eligible for a VAT refund for products bought at registered stores, under the VAT refund scheme for tourists.

VAT return filing can be made a hassle-free process with the help of AON. We have been associating with FTA for VAT related issues from quite a long time and hence are well-versed with the complete procedure. AON’s VAT consultants are ready to guide you professionally on VAT return filing, anytime.

ALRIYADAH
Al Hind Tower #1405 AlKhan - Sharjah
OUR LOCATION
https://alriyadahae.com/wp-content/uploads/2019/10/img-footer-map.png
GET IN TOUCH
Alriyadah
Al Hind Tower #1405 AlKhan - Sharjah
OUR LOCATIONS
https://alriyadahae.com/wp-content/uploads/2019/10/img-footer-map.png
GET IN TOUCH